The precedent decision of Finance Minister Avigdor Lieberman, together with Construction and Housing Minister Zeev Elkin and Interior Minister Ayelet Shaked, to return no less than 13,000 apartments in the central area, used as residential apartments for use by AirBNB hoteliers, provoked various reactions this week in Tel Aviv, the capital of industry This one in Israel.
It is estimated that in the city alone, 8,000 apartments will operate in 2021, as guest apartments for all intents and purposes.
Everyone agrees that this move should have happened a long time ago, but will it really affect the already crowded housing market in Tel Aviv and the center? Hence, of course, opinions are divided.
Lawyer Daphne Lang, who specializes in real estate, has in recent years waged a fight against the phenomenon and against the apartment owners used for accommodation. This week she tried to illuminate a different angle in the new government plan: To its name, and this will introduce regulation. It should be understood that this phenomenon of AirBNB in Tel Aviv is the essence of Tel Aviv's pig capitalism. "
Lang tries to put things in order: Once because they want their apartment not to stand empty - but in entire buildings of large real estate companies, which are designed for just this purpose. This is a business for all intents and purposes.
"In my opinion, things need to be taken care of and regulated. The fact that they will raise taxes on apartments here or try to stop the phenomenon, that's nice in theory - but I'm not sure it will work. Investing in apartments, and of course turning them into a tourism business, In Kahlon's reform, which had a short-term effect, after which people returned to buy apartments for investment. "
A threat in the form of real estate
The Corona seems to have been the crisis point when it comes to caring for guest apartments. If until then there was a tacit agreement that everyone enjoys the respectable amounts of tourists who came to Israel, in such a way that the hotels in Tel Aviv did not take seriously their new colleagues who were also bitten by the exploding market - then the closure of Ben Gurion Airport for a long time crushed Tel Aviv tourism. A threat, in the form of an apartment in one of the most sought - after areas in the city - re-awakened the struggle between institutionalized and old tourism and the young guys in the neighborhood.
Leon Avigad, one of the owners of the Brown hotel chain, What to compare this phenomenon in Israel with this phenomenon in the world, in the sense that most of the time you come abroad you will understand that you are staying with someone who lives in this house, and he is happy to host and guide you.
"On Sheinkin Street, for example, there is a whole building and all apartments for rent. But there is no guard down like in a hotel and no regulation. When I open a new hotel, I have 16 regulators: Ministry of Health, Environment, Engineering, etc. They have nothing and no one supervises them. Not the government, not the municipality, nobody.
"In this sense, are we completely different from the world?
I think the answer is no.
Here, too, it seems that this market has completely exploded in terms of regulation in many places, and even there they are looking for ways to deal with it, and in some places they are also successful, of course.
I hope that stopping this thing will lead to further regulation, but I feel that maybe things were done too late and too little. "
"Closure? Crazy penthouse"
Veteran hoteliers may be right. This phenomenon is too great for a government that is already preoccupied with coalition survival, and for a municipality that is in a construction boom and the prices in the city that it manages are just rising. In addition, it should be remembered that this is not just a Tel Aviv phenomenon, but one that crosses cities and sectors.
In the big world, companies related to the field raise tens of millions, and as you may recall, AirBNB itself was issued with a value of $ 47 billion. It is doubtful whether this phenomenon is on the way to disappearing or being damaged. This is not a passing trend and it may be better to try and find constitutional solutions than to try and close the phenomenon completely.
For the Tel Avivians, probably in Corona, these apartments were an excellent solution. Boaz, whose family fell ill in Corona at several different stages along the waves that came and went, explains: "We were looking for a house with a yard so we could be with the children in isolation more easily. It was the perfect solution. Another time, in the second wave, we took a crazy penthouse on Hayarkon Street. "In fact, no one in Corona has given a more perfect solution than these apartments for the residents. And if there are more waves in Corona, it is clear that whoever can afford them will return to these apartments to pass the time safely."
Oded Grofman, CEO of the Tel Aviv branch of the Hotel Association, thinks that despite the opinions here and there, this is a historic and important step but not enough at this stage: "
"As part of this activity, the association approached the tax authority, asking it to act to withhold tax at source, as AirBNB has already undertaken in 400 agreements with countries and cities around the world, and only in Israel does it act differently due to lack of enforcement. For years, the direct effect of these apartments on the rental prices of rooms in Tel Aviv has led to an increase of about NIS 1,000 on average for a two-room apartment.
"This is a direct impact on the activity of renting apartments for the short term, and regardless of other variables in the economy. Tel Aviv Municipality, for its part, understood the negative impact of the phenomenon on housing prices and the social implications of this activity, which affected residents." Use these apartments for a cooperative economy for 90 days a year, similar to similar cities in Europe. "
Is this good news or not?
only time will tell.
However, it is important to note that as long as Israel is not yet flooded with tourists - this battle will remain in the headlines in order to try and change the housing market as well.
When the corona passes and the tourists return to Israel, it seems that this blessed idea will be ignored, and as always in these cases - the market forces will win, and an apartment in Tel Aviv will continue to be a coveted, but sometimes unattainable task.